Anyone here own a game store

[LimitedEditionMuseum]

Or in any type of gaming businesses

[MachineGex]

I use to own two stores in Northern California. I started Video Game Exchange in Lodi, CA. in 1995. A few years later, I opened our second store in Stockton, CA. Both stores did very well. I sold them both to my brother-in-law in 2005.

It was a huge learning experience and if you didn't make good decisions and adapt quickly, you were cooked. But on the flip side, if you worked hard and took good care of the stores, they made a great income. It is either feast or famine. I believe the choice is up to the owner and how hard they work. You have to put in long hours cuz there isn't an employee that will work as hard as a good owner.

If you stop taking care of the store(watching inventory, making sure the store is clean and squared away, adding new products, etc.) you can sink extremely fast. I have seen new owners take over established stores(making 6 figures) and run it into the ground in 12 months. It is easy to call in sick when you own the place. It is also a great way to ruin a good business.

As you can see, I can go on & on about this subject. I have actually written a guide (of sorts) on opening a video game store. It usually boils down to how hard the owner will work and the decisions he makes.

/rant

[sloan]

No, but I have the inventory and am thinking strongly about it.

[Camp]

Or in any type of gaming businesses

What's the point of this thread? Are you looking for advice? Do you just want people to say yes or no? I don't get it.

[LimitedEditionMuseum]

I was waiting for more people to answer or chime in. I just wanted to know more about the business side of owning a game store.

[theMot]

Stay well away. New games are going all digital within the next 5 years and you'll never make any serious money from retro stuff. Keep gaming as a hobby and just enjoy it for what it is.

[dendawg]

New games are going all digital within the next 5 years and you'll never make any serious money from retro stuff.

Lots of progress needs to be made on the internet provider's side for all-digital to ever be successful, such as much higher bandwidth caps and faster connections. As far as retro never making any money, be sure to tell that to Goatdan, who runs the Goat Store, or the guy that runs Stone Age Gamer, or even the people who sell retro on ebay or Amazon. There's so many on there, surely they're just hemorrhaging money.

[theMot]

Lol at those sites...

Go back and read my post. Notice i said "serious money" not pocket money. People get all romantic about owning their own video game store. The reality is digital is the future and all the retro stuff will only produce meagre profits at best. I love this stuff as much as anyone else on this site but im also a business owner 9-5 and i know whats it takes to keep the doors open. Copies of super mario world and clone consoles isnt going to make serious coin. Running a business and loving games is two different things.

[theMot]

Lol at those sites...

Go back and read my post. Notice i said "serious money" not pocket money. People get all romantic about owning their own video game store. The reality is digital is the future and all the retro stuff will only produce meagre profits at best. I love this stuff as much as anyone else on this site but im also a business owner 9-5 and i know whats it takes to keep the doors open. Copies of super mario world and clone consoles isnt going to make serious coin. Running a business and loving games is two different things.

[dendawg]

Notice i said "serious money"

Goat Store has been around since 2001. Surely it would take more than just "Pocket money" to keep it up and operating.

And BTW...if digital really is "the future," then why did Onlive and PSP Go crash and burn so horribly?

[theMot]

Goat store probably just loves doing what he does, which is great! When you look at it like that its all good, i doubt that is their main source of income though.

Put it this way, a business that is doing well generally makes about 20% profit. Or lets call the 20% your "wage", if i want to make even 50k a year i have to be turning over about 250k a year or about 5k a week. Go to goat store, stone age gamer or ebay. Add up their inventory, they probably arnt even holding 10k worth of stock. Good luck even finding 5k worth of retro stock to sell every week letvalone the customer base to support it. There is simply no money in selling retro games because of those two problems alone.

Digital downloads are the future if you dont believe ok... Go look at the margins on new xbox and ps games. The retailers are making about $10 a game. Even if you sold 10 a day its still only $100 dollars. It just doesnt add up in the end.

[DeseoParadise]

I have one in Ebay

[sloan]

Stay well away. New games are going all digital within the next 5 years and you'll never make any serious money from retro stuff. Keep gaming as a hobby and just enjoy it for what it is.

I get the feeling this guy knows what he is talking about. To make it in any business, the margins have to be large enough. Buying game carts at $1 a pop and reselling them at $3 a pop is not going to be able to keep the lights turned on unless you are turning over massive inventory on a weekly basis. You would have to have a full time person out scouring yard sales, pawn shops, and charity thrifts just to keep your stock replenished. Local guys I have seen doing this type of business are mostly there 12 hours a day and look overly stressed. Not for the feint of heart.

[Bazoo]

What about stores that combine their market with DVDs, books, comic books, or other merchandise? On one hand, the really successful business in my area does this, while at the same time offers some incredible deals on the games. I have no problem with that if it is manageable, as it seems like everyone wins out in the end. Of course, some other businesses in the area weren't too happy when the store popped up, but that seems like the "adapt or bust" factor that MachineGex was talking about. At the same time as bringing more inventory to turn over, it also gets people in the store--"Hey! They still sell SNES games!? No way, I might pick one up!" So I mean it's kind on a good philosophical footing as well, exposing people to more rich and vibrant media (lol). On the other hand, I can see how that might diffuse some aspects of the business, and if it really takes a true owner to "care" about the store then it's tough to account for the store. It also might make for more dead inventory, if, say, you don't know games as well as you know DVDs, and you might not be able to turn stuff over fast enough (as per the above poster's argument) anyway.

[MachineGex]

I get the feeling this guy knows what he is talking about. To make it in any business, the margins have to be large enough. Buying game carts at $1 a pop and reselling them at $3 a pop is not going to be able to keep the lights turned on unless you are turning over massive inventory on a weekly basis. You would have to have a full time person out scouring yard sales, pawn shops, and charity thrifts just to keep your stock replenished. Local guys I have seen doing this type of business are mostly there 12 hours a day and look overly stressed. Not for the feint of heart.

My experience couldn't be further from his breakdown. His numbers may be right for a traditional store/business, but a used game store doesn't have the overhead like other places. If you aren't making at least 50% of your sales in profit, you are doing several things wrong. Remember, a Mom & Pop store doesn't have the overhead as other stores. People trade in games for other games. Usually at a 2-1 or 3-1 trade. It doesn't take too long to build up an inventory. Most don't get employees until they are established. The difficult part is lasting 2 years until you have a good customer base.

Also, new owners are NEVER prepared for how much work goes into owning a business. If you think you are going to pay someone to just run your place for you without being involved, you are wrong. Most small Mom & Pop shops don't get an employee for a year or two. I can talk numbers all day and have over 10 years of experience running two(successful) stores to back it up. Getting to 300K-400k in sales is difficult and takes hard work and time, but it can be done. If you think about expenses, they don't add up to 1/2 of that(not even close). Rent was by far our biggest yearly cost(not counting start-up costs). Inventory costs a ton in the beginning, but after you get trades going, things start to cook. Sure going to local flea Markets, good wills, garage sales, etc. helps a lot, but that is what SUCCESSFUL owners do before they open for the day and on their days off(if they ever get one).

[theMot]

My experience couldn't be further from his breakdown. His numbers may be right for a traditional store/business, but a used game store doesn't have the overhead like other places. If you aren't making at least 50% of your sales in profit, you are doing several things wrong. Remember, a Mom & Pop store doesn't have the overhead as other stores. People trade in games for other games. Usually at a 2-1 or 3-1 trade. It doesn't take too long to build up an inventory. Most don't get employees until they are established. The difficult part is lasting 2 years until you have a good customer base.

Also, new owners are NEVER prepared for how much work goes into owning a business. If you think you are going to pay someone to just run your place for you without being involved, you are wrong. Most small Mom & Pop shops don't get an employee for a year or two. I can talk numbers all day and have over 10 years of experience running two(successful) stores to back it up. Getting to 300K-400k in sales is difficult and takes hard work and time, but it can be done. If you think about expenses, they don't add up to 1/2 of that(not even close). Rent was by far our biggest yearly cost(not counting start-up costs). Inventory costs a ton in the beginning, but after you get trades going, things start to cook. Sure going to local flea Markets, good wills, garage sales, etc. helps a lot, but that is what SUCCESSFUL owners do before they open for the day and on their days off(if they ever get one).

That's great to hear MachineGex, I stand corrected.

My experience in business is from two other totally different industries to this so if you are able to do at least 300k and come out at 50% profit your doing well. Location would have a lot to do with it though I would assume your stores are in good high traffic areas?

[Badhornet]

Game Over Video Games here in Texas has done very well. They started out a few years ago, and opened their 5th location this month, and their 6th will open next month. Even thought they are a bit on the high side on their prices, they advertise and market themselves really well. They are at every video game convention or comic, toy, anime event throughout the state and beyond. They have tournaments at their stores, and free movie nights on the big projector screen in their parking lots. Great website and facebook pages. I think they do everything right when it comes to advertising and word of mouth for their stores.

[Collector_Gaming]

Game Zone in salem MA although sells new gets its big recognition for selling old stuff and been doing for awhile from what i understand. Also theres another place in MA called Video Game Castle which I have a guy who said he use to go there when he was a kid years ago all the time.. He took me there last year (which I bought Nightmare on Elm ST for NES from there) and they sell mostly retro. Must be doing something.

[DDCecil]

I owned one for just one year back in 2006. When it all comes down to it, I should of never taken the plunge. Basically, I was just trying to fill a void that was left in me since my dad's store was closed down prematurely back in 1999.

I just used my entire 1,400 game collection and very l-i-t-t-l-e m-o-n-e-y (and a second job cleaning toilets!) to start and keep it afloat. By the final month, I just didn't give a shit anymore, and neither did anyone else.

[MachineGex]

That's great to hear MachineGex, I stand corrected.

My experience in business is from two other totally different industries to this so if you are able to do at least 300k and come out at 50% profit your doing well. Location would have a lot to do with it though I would assume your stores are in good high traffic areas?

Yeah, picking the right location is one of your biggest/important decisions. You have to find the right store/location/landlord. Make sure you interview your landlord. You don't have to do a big interview, but you have to get an idea of what he is like. Is he going to let you do parking lot sales? Is he ok with having a movie night like someone mentioned above? Is he only interested in getting his monthly check and wouldnt allow you to be creative?

Badhornet made a great point about the store around him. They go the extra mile. You cant just open a store and expect it to thrive. We went to every little street fair, flea market, convention, bake sales, etc., that we could think of....

Most traditional advertising costs a fortune and really doesnt work. You have be creative. I spent a full week just driving around town putting flyers on cars. I hit every Walmart, Costco, Softball Tournament, door2door, that I could. It's hard work.

Bottom line..... If you arent going to spend every minute of every day thinking of a way to help your store, then dont do it. The first 6 months I worked from 8am to 8pm / seven days a week. Not ONE day off. After that I went to a six days a week, same hours schedule.

After a few years, I was able to cut back alittle(very little). Then a second store and another huge set of problems.......EMPLOYEES!!!!!

One final thing to remember. You miss out on a lot of things being an owner(specially in the beginning years). When your friends go on a skiing vacation for the weekend, what are you gonna do? When you get an offer to go to Tahoe for a few days with some "friends", are you gonna chase that tail? When your friends rent a house boat for the week, are you OK staying behind? And bottom line.....Can your nose stand the smell?